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Billings and Job Cost Reconciliation- What's the point? (3)

Updated: Aug 23, 2022

Now that you've reconciled job billings and costs to the trial balance you're ready to put a bow on it!

You performed all of these steps to ensure the completeness of your project listings and activity. Where you think you're at on billings to date and costs to date may be completely different than what your books say, so it's always a great idea to perform the reconciliation!

Do you remember the number key? 0- Open, 1- Closed and 2- Closed in Prior Years, in case you forgot. These codes will help you compile the necessary reports to calculate WIP and to prepare the closed and open job schedules attached to your financials.

By filtering the reconciliation to only include 0s, you'll have the billings to date (Column J) and costs to date (Column T) for the jobs in progress at year end. Check out the WIP lesson series for information on the other WIP inputs and additional guidance!

Filter the reconciliation to only include 1s and you'll have the contract totals, in both revenues and costs under Columns W & X. The revenues column should match up to the final contract price with all change orders factored in. And as you guessed, the total costs are the costs incurred from the beginning to end of the project. You can use this report to help compare the total costs to your estimates. Hopefully you were close!

And the 2s??? You generally hope that the activity on jobs closed in prior years is minimal as these jobs should've been completed. However, it is common to have activity on these projects as you've experienced in the past. Such activity is typically included under "Other" on the completed contracts schedule your outside CPA prepares.

Any questions??? Please don't hesitate to reach out at!

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